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Monday, June 16, 2014

A brief history of the Internet and a mildly amusing theory about software platforms versus protocols.

The Transatlantic Telegraph

On August 16, 1858, the first message was transmitted from North America to Europe via undersea cable. The message was sent using Morse Code.

That cable no longer exists. It's long been reclaimed by the sea.

But Morse Code is still used commercial and emergency applications to this day.

ARPANET, TCP/IP and TELNET

On October 29, 1969, the first message was transmitted from UCLA to Stanford over ARPANET, the first packet switching network. After a few iterations, TCP/IP was adopted as ARPANET's standard protocol in 1983. ARPANET became a subnet of the internet.

On February 28, 1990, ARPANET was taken offline.

However, TCP/IP is still the protocol stack the internet runs on to this day.

GUI Online Services, the Web and E-mail

The 1980s saw the rise of consumer pay online services. These included CompuServe, Prodigy, GEnie and AOL. These were initially walled-garden platforms, but by the early 90s, they had allowed for mass adoption of the larger Internet by allowing access to email and the web through easy to use graphical user interfaces. In 1989, CompuServe became the first walled-garden online service to offer incoming and outgoing email connectivity with the Internet at large.

Ultimately, AOL grew to become the world's largest walled-garden Internet community. Its stock soared going into 2000, when it bought Time Warner Inc. At the time of the merger, AOL had a market value of $162 billion.

By 2002, AOL had over 25 million paid subscribers worldwide, with access to standard email and web, in addition to its proprietary services.

By 2003, AOL's market-share was declining with the rise of free web-based email services coupled with affordable ISPs. In mid 2006, AOL began offering free email for non-subscribers to slow the rate of defection to other free email services such as Hotmail and Yahoo!

Today, AOL's walled-garden platform no longer exists.

Its current incarnation as a services, news and branding company has a market cap of about $3.7billion. Roughly, 2.5% of its peak capitalization.

There are still an estimated 2 billion email users worldwide.

Software Platforms Versus Protocols

In describing the difference between platforms and protocols, the most important word that comes to mind is "transcendence." When something is transcendent, it breaks out of confinement.

In this relationship, the Platform is the "confinement." The protocol is the "thing" that "breaks out."

This is the case illustrated by all of the above examples.

My argument is that Twitter is transcendent. It behaves like a protocol. It's a method of transport, and its inherent usefulness does not rely on the survival of its platform or any platform.

On the other hand, the fundamental value proposition of Facebook is only as good as its ability to keep uses on its platform.

This was the exact problem AOL faced at the turn of the century.

It's my opinion that Facebook is an identical product to AOL. In a way, it's a weaker product because Facebook does not solicit the inflation-adjusted $25/month that AOL used to get in the '90s. But as the web has become more robust, the ability to operate a platform equivalent to AOL through a browser instead of a stand-alone program has become reality. And that's precisely what Facebook is doing.

As the Internet evolves and we explore exceedingly unthinkable possibilities, Facebook's core business will still need to exist inside its platform or it ceases to be Facebook, as we know it. An analogy, aside from AOL, is Blackberry. As a platform, Blackberry is in critical condition. But their one hope is pivoting into the protocol business. A "transcendental" version of BBM, essentially a rich instant messaging protocol, will likely be their only business. If this sounds familiar, it's because it was one of AOL's post-platform pivots with AOL IM.

With Facebook, I'm not quite sure if they have a single component that has a life after platform.

The scary thing about all of this is irrational exuberance. It is uncanny how history has a tendency of repeating itself.

On January 10, 2010, AOL announced its intent to acquire Time Warner for about $182 billion in stock and debt. On that day, AOL was trading with a market cap of about $163 billion. It's significant to note that AOL had twice the market cap of Time Warner that day. It's significant to note that Time Warner was doing three times the revenue as AOL. It's significant to note that the deal left Steve Case more powerful than Ted Turner in the new company.

But through the lens of history, it's probably most important to note that today, Facebook is trading at a $144 billion market capitalization. That's edging on AOL's peak market cap. Facebook is booking about $6.87 billion in revenue, which is more than AOL's historic peak revenue. Finally, Facebook is pocketing about $1 billion a year, slightly more than AOL's peak net income.

Across the board, Facebook's current key statistics look so similar to those of AOL's at its peak, it's a little uncanny.

The cycle of market bubbles predates modern exchanges. The cycle of rapid adoption and abandonment of communications platforms predates the internet. Yet, irrational exuberance gets the best of us. We drive up financial markets. And so often, when the bubble bursts, it's platforms like AOL and Blackberry leading the dive.

I'm of the opinion that Facebook will find itself in a similar position. And it too will lead the dive of its sector. This cycle appears to be an inherent aspect of communications technology. I don't think this indicates something wrong with the businesses that live this cycle.

Rather, there seems to be something about society and how we interact with each other through technology that drives this cycle.

I believe that while ubiquity requires a critical mass, abandonment also requires a critical mass.

An important aspect of new communication forms will always be novelty and exclusivity.

Novelty and exclusivity make new communication technology an attractive alternative to real life. These are two things that are always defined by the platform. Not the protocol. And as novelty and exclusivity wain, the platform loses unique value.

But the protocol, the transport technology that powers it, can live on.

Thursday, June 12, 2014

In 1985, the European Journal of Clinical Psychopharmacology published the results of a study conducted by the University of Leeds in the United Kingdom.

Subhan & Hindmarch found that 40mg of vinpocetine significantly improved memory in healthy humans, compared to the control group.

The class of substances used as "smart drugs" are called nootropics. They are mix of natural supplements and synthetics used to enhance brain performance. Some are stimulants. Some boost blood circulation to the brain. Some support cell health. Some improve or even increase production of neurotransmitters.

And today, nootropics are all the rage.

Ray Kurzweil famously published a list of all his daily supplements, many of which are classified as nootropics.

Message boards all over the internet are lighting up with brain hackers creating their own nootropic "stacks" or ideal blends of nootropics to take daily.

If you hang out on message boards, you can get sucked down a rabbit hole that encompasses everything from kids talking about their amphetamine score to boost their homework skills to daring individuals mega-dosing on chemicals because there was that one promising racetam study on mice.

Okay, that said, I must confess. Vinpocetine is not the only nootropic I'm taking.

I'm also taking bacopa extract. In 2001, the School of Biophysical Science and Electrical Engineering in Australia found improved cognitive function in a double-blind placebo-controlled study in humans.What can I say. Hacking your brain with nootropics can be addictive.

And now that pre-formulated, brain enhancing stacks are available the same way you can purchase your multivitamin, they are accessible to everyone.

How accessible?

Well that's easy to test. It just requires a visit to my parent's home.

I went there and did some snooping in my mother's medicine cabinet. She had this supplement bottle I had never seen before. I won't say the brand because it was private labeled for her physician and I don't want to poke the bear.

This stuff is exactly what it sounds like. It is literally extracted from the discarded adrenal glands of slaughtered cows. It supposedly supports a wide array of functions including fatigue and stress.

Hah! Sounds like some quackery to me.

But wait, then what am I doing hanging out on reddit with a bunch of sixteen year-olds figuring out the best amino acid to jack their caffeine high?

Tuesday, April 2, 2013

In 2007, we started covering the first US presidential election in history that required the candidates and the media to engage voters online with digital content and social media. Digital content changed the world at that time. Online engagement leading up to the 2008 election of Barack Obama forecasted the results earlier and better than traditional polling and pundits. As a result, digital content strategies are assumed for all political campaigns and mass movements. The revolution happened so quickly. In a blink of an eye, digital, social and mobile strategies were the new status quo.

By 2008, it was overwhelmingly clear to us at Viralroots that our experiment and thesis had moved way beyond discussion. It was reality. We returned to our day jobs and pursued other projects and experiments.

Recently, I've reengaged Viralroots as a platform to discuss the impact of digital content in arenas other than election politics. Specifically, the impact on branding and marketing.

I believe that high value content is coming from unusual places at this time. Digital content is prerequisite in all marketing and distribution strategies, but it also must share an ecosystem with diverse user generated content, piracy and re-posts. As a result, there is a lot of noise, which creates a huge discoverability problem.

There's amazing professional and user-generated content on the web. And there's even great content either distributed, curated or generated by brands. But making sure people get to see the best content across all of these categories is tricky. Yet somehow, some of it breaks through, finds a tipping point and zoom, that's why we started talking.

But, this is not 2007.

Discovery solutions seem to be emerging from the least likely of places, such as 4chan, a place where brand skepticism and subversive action can inadvertently drive mainstream awareness for otherwise poorly performing, low impact, marketing campaigns.

You should know what this is.

The image is from the AXE Space Challenge. A peer-vote-driven contest for a chance at space travel. The face in the picture belongs to Christopher Poole, aka Moot, aka the founder of 4chan. The people of 4chan, on an ordinary day, have nothing good to say about AXE or any other consumer goods.

The contest was doing fine as of yesterday morning. The first place contestant had a few thousand votes.

Then 4chan decided to send Moot to space.

Last night, Moot had 400,000 votes.

The contestant behind him had 40,000.

The votes were not all legit. Earned by scripts moving votes through proxy servers, true to 4chan fashion. But man, what a story.

Moot has since been removed from the competition.

Just one example.

It's places like 4chan, sorta the sleeping giants of viralroots rumblings, that have an unprecedented, untested capacity to prove disruptive in the content game.

But, probably to the utter confusion, fear and paranoia of brands, it looks like what makes them disruptive might also make them a ticket for success. In the example above, a small community drove a massive feedback loop, bolstering awareness on Facebook and across the web. If not for them, I'd never be plugging AXE. Yet, here I am.

Can brands learn to play nice and forge relationships with niche communities and organic content distribution?

It seems to have worked for AXE, but there's no doubt it worked by accident.

The lesson is still the same:

We're way past subversive marketing.

Prepare for subversive consumerism as a platform for organic distribution.

Turns out, your content does not actually have to be native if it invokes mischief in the right group of people.

This is scary stuff. It requires letting go of a huge amount of power.

It requires you to question why consumers like your content.

Furthermore, it may require you to stop caring why consumers like your content, so long as they do.

Here's my perspective. We started writing Viralroots in 2007. We stayed on topic. More than 75% of our articles are tagged, Viral Politics. What's our most blogged about, most linked to, most trafficked article of all time? The one about Dennis Kucinich's sexy wife.

Wednesday, March 27, 2013

or, Blogging from your toilet 101: A Rant
As I make my way through my soon-to-be-deceased Google Reader list, I find myself especially annoyed this morning by how many repeat blog posts I'm seeing.

There are far too many blogs falling back on the, in-case-you-don't-look-out-your-window-or-watch-cnn-or-read-drudge-or-the-times-or-deadline-here's-some-breaking-news paradigm.

And they leave it at that.

These stories often don't get further opinion or insight on their way down the food chain.

They just tumble on down.

Don't get me wrong, I'm sure I've been guilty of this in the past. It used to make sense when everything was traditional media and certainly someone had to migrate it to the web. (I remember when we used to actually scan pieces of paper for text and images.) But that's all changed.

In my opinion, the big changes started when the "official press release" marketing machine got thrown out of whack by the Internet.

Once upon a time, we used to rely on daily trade publications to read placements masquerading as breaking news. You gotta give Nikki Finke credit for this one. She took a game that, in the entertainment world, was OWNED by daily publications Variety and THR and proved she could scoop their printed breaks on a blog, hours if not days earlier.

Her success, in my mind, defined the news-breaking paradigm that blogs can serve. They're not CNN. They're not KCAL 9. Meaning, blogs will never bring you live transcription of supreme court hearings or a helicopter shot of a police chase. But they can successfully sift the noisy deal-making, publicity and marketing machines of an industry, and find news there before official press releases break.

This is a massively powerful function. It subverted the way corporations communicated. And it now drives an entire derivatives market of lesser bloggers repeating high value content, like scooped press.

This is actually one of the many reasons the death of Reader breaks my heart. The ability to consolidate news sources and consume them in chronological order sheds a huge a mount of light on who broke a story and who's regurgitating it. Furthermore, who's regurgitating it in a timely manner and who might be adding valuable insight.

In a world were my time is valuable and I need to consume information as efficiently as possible, Reader helps me identify low-value content and either skip it or remove it from my list.

So, breaking news like Bank-Robber-on-PCP-Speeds-Down-405 breaking news doesn't seem to be a good plan for your average friendly neighborhood blogger.

Scooping official announcements seems to be a surgical craft, owned by digital operations who have emerged from or replaced legacy print operations. And merely repeating this information can drive traffic, but you're not generating valuable content.

This leaves editorial.

Editorial is the space in content that you get to fill with personality that separates you from other blogs and other bloggers. This is the space where you can make your content valuable by making it uniquely yours.

If you want to successfully blog from your toilet or a Starbucks or a Starbucks toilet, please stop creating low-value content.

If I've seen it already, it has no value.

I don't care if you're a movie blog and the information is movie-related, so you want to share it.

If I've already seen it, it doesn't make me think you publish a lot.

It makes me think you publish too much and you're not contributing value to the conversation.

I guarantee you, if you're blogging in a niche, there is demand for amazing original content. This sounds pretty basic, but if you look at my Reader list, doing this well is still the realm of a small handful of key players in any given niche.

For instance, io9 and Geekologie are some of my favorite nerd reads. The two blogs cannot possibly be more different. io9 provides a well edited magazine-type experience. As much science as sci-fi. Extremely well written and detailed, original content that appeals to my interests and always sheds new light on a topic, even if it's about something familiar.

On the other hand, Geekologie is quick. Snappy. Image-driven. But GW's commentary is funny. It's brief, but it shines and it's distinctly him.

In my mind, both these blogs are premium offerings within the nerd niche and are equally important components in my reading list.

My interest in them is not story breaking ability, but quality and presentation. Valuable editorial content. From them, I know it's a good read. I know I want to read their next articles. I know I want to share their stories with friends.

There's a real value proposition going on with both these blogs.

Regurgitating breaking news in a large field like entertainment seems like a better recipe for traffic, but that's not how you're going to keep an audience over time. It's not a feasible business model to push from your toilet.

Wednesday, March 20, 2013

Google broke my heart three days ago, announcing the end of Google Reader. The service will go offline July 1st. Almost immediately, articles suggesting alternative news readers started sweeping the blogosphere. One particular service, Feedly has come up a lot, for having form and function very similar to the Google Reader experience. It turns out, this is the best possible news for Feedly. Their blog states that "more than 500,000 Google Reader users have joined the feedly community over the last 48 hours." Google shutting down Reader has literally put Feedly on the map.

So here's my question: Why would Google shut down Reader in the first place?

Google cites a loyal following, but it has declined. But the Feedly story seems to suggest differently. And Google does keep a fair amount of legacy offerings up and running. A "loyal following" seems like all an app like Reader would need to remain a legacy product.

I can't help but think this is about something else. And I suspect that something might be advertising.

RSS was never mainstream. It's a geek tool. It's barebones. It's down and dirty. It's great for collecting the sources you trust to one place, moving through information fast, focusing on what you care about, and ignoring what you don't.

Ironically, I just described Facebook and Twitter.

And maybe that's the issue. Google Reader takes content, (I mean real content. Articles, studies, white papers, not single sentences and photos of your nephew.) dislodges it from its advertising and hey-stay-a-little-longer filled home, and presents it as-is.

In today's world, that seems like an awful lot of great content and hard work to give away for free with very minimal, easy to skip, advertising.

My guess is there's a solution in the works that keeps aggrogated content married to advertising in a more effective way than Reader.

-An additional six web connected devices, all tansfering data through the same static IP address, but with unique MAC addresses.
-A relatively sophisticated bit of spycraft consumers refer to as the Microsoft X-Box Kinect.
-An electrical grid smart meter that delivers real-time energy usage, not only the utility company but also to me, or anyone with my credentials, over the web.

And if we were to reel the scope of this question to only within inches one's body, there's RFID in our wallets and on our keychains.

And if we were to expand the scope of the question to outisde of fifty feet, there's neighbors with their own prized collection of corporate spytech. There's traffic cameras, parking enforcement vehicles equipt with license plate readers, and on, and on...

I think I've made my point.

Today, we are surrounded by endless instruments for individually identifying, gathering and storing information. These tools are accessible to hackers, jealous lovers, private investagators, concerned parents, major corporations and, of course, the government.

This is all a result of hivemind logic deciding that Google Glass is somehow more insidious than anything we've seen thus far.

What a fabulous destraction from the spytech already all around us.

Let's focus on the one device that one wears on their face. The one device that is overt, obvious and public. The very intention of the device is to collect and augment information from the world around us, and hopefully do something with that information to make our days a little easier.

Let's completely ignore all the covert and insideous devices that hide within the gadgets we've welcomed into our lives over the past several decades.

Courtesy of Stop The Cyborgs, the following exchange with a Google spokesperson:

A Google spokesperson responds:

“It is still very early days for Glass, and we expect that as with other new technologies, such as cell phones, behaviors and social norms will develop over time.”

Stop the cyborgs reply:

"We couldn’t agree more. These early days are our opportunity to proactively shape the social norms and technological development through public debate, politics and individual action rather than passively accepting and adapting to new technology."

Anyone pretending that we are somehow in the "early days" of the surveillance security discussion has zero grip on the last three decades of computer technology and takes for granted the technology that is already within three feet of us.

You know what's great about Google Glass?

You know when you're staring right at it!

It practically screams, "Hi, I'm a camera! Behave like you're in front of a camera!"

Well, that depends. If the freedom to ignorantly assume a camera is not recording, in spite its obvious presence, is a basic human right, then I guess it needs a blinking light.

But in this world, that's staggeringly shortsighted logic to rely on.

It's right up there with not looking both ways when you cross the street, since, duh, pedestrians have the right-of-way. If a car hits you, it's their fault! So they should look, not you! It's a totally weak argument if you end up dead, and it's a totally week argument for assuming a right to privacy.

"If you have something that you don’t want anyone to know, maybe you shouldn't be doing it in the first place."

Most people find this notion abhorrent. A violation of a basic human right to privacy.

Believe what you want, but your beliefs do not change the reality of the statement. This has been the reality of our world for quite sometime. It is not a new reality forged by Google Glass. And it is not a reality that will be going away anytime soon.

You can fight it all you want. You can lead debates, make bumperstickers and fight for initiatives to unwind it. You can even become a cybernetic bigot if it floats your boat.

But what I would not suggest is allowing yourself to be consumed by the distraction of wearable devices like Google Glass while ignoring the reality and capability of what's already in our pockets, on our desks and staring at us in our living rooms.

Because that position is too little too late.

That position is like arguing with the driver over right-of-way as you lie bleeding in the intersection.

These are real:

They have been for quite some time.

Who knows, they could have kindly walked you back to your dorm room. The rest of the details are fuzzy.

Wednesday, March 13, 2013

Netflix showed us with HOUSE OF CARDS that if you trust the talent and give them enough money, they can create premium content anywhere. We no longer live in a world where must-see-TV can only be produced, and more importantly, distributed by studios and networks. Moving forward, we'll continue to see premium content emerging from distribution-driven models, but replicating quality and reach is only half the equation. I don't mean this in a bad way. I think it's extremely important that Netflix is putting their money where their mouth is, effectively saying, hey we tap talent like you, we spend like you, we get to "jog" with you. Anything short of that would have given them excuses to make in the face of a potential failure. But we only had Canadian actors, for instance. (For example, see Halo 4: Forward Unto Dawn.)

The Veronica Mars movie funded on Kickstarter, will hopefully reveal the second half, in my opinion the more important half, of the equation. I'll pose it as a question. What is the real cost of ninety minutes of content created by premium talent using premium technology, but working for ownership in the negative instead of upfront fees? Based on this campaign, as well as financial models and budgets I deal with on my day-to-day, the answer is somewhere right around here: $2,000,000. The campaign does state that obviously all proceeds over $2million will go into the budget, which I'm sure they'll be happy to have. Again, I know for a fact that this number is feasible providing you leverage the correct talent. (I'll probably write more about that in the future.) To be fair, Warner Bros. does own the underlying IP and they're hard pressed to give up ownership. Sources tell me they may pony up production funds (in addition to a domestic limited theatrical release, no doubt to leverage oversea sales (and likely canabilize a digital window)), which would no doubt contribute to fees, but the model can work just the same with ownership pooled for talent.

Now, it's speculated that HOUSE OF CARDS came in at around $3.8million per episode, on the cheap end. And going forward, the same speculation suggests Netflix will continue pushing budgets around $4million per episode for future shows.

So, the implication here is that it's quite easy to spend a 100% premium between fees and production costs if given the opportunity.

But what happens if you're not given the opportunity?

Tighter budgets and back-end compensation seem to suggest an emerging model for digital content that might just allow creators and consumers to have their cake and eat it too: Greater numbers of niche shows/films/experiences of premium quality created on smaller budgets, reaching pre-engaged audiences on different-sized screens.

The brand play makes perfect sense. We're talking marketing budgets in the billions, especially in automotive and consumer electronics. Why just spend it on commercials? They're expensive. They air a few times. Sometimes they're cool, but with time, they always become invisible. Here's an opportunity to build content libraries. Products unto themselves. Consumable. Re-consumable. They garner empathy and fans. Serialized or episodic, you can track engagement.

So simple, right?

Here's (some) of the reluctance: But what about GRPs?
I have this conversation all the time. Brands love their GRPs.

I'm always talking to engineers on the analytics side. I usually like to scream at them. It goes something like this:

What the fuck? Your network has upwards of 500 user touch-points. Why is your latest, greatest product a GRP solution? It doesn't make sense! Why don't brands use these touch points? If the brand is the content instead of just the interstitial, they'll understand, won't they? Who gives a shit about GRP? It's a Furry Convention Time Travel show, not a fucking billboard on the way home from work! And that 250k buy from The Tampon Company that's rendering 75% on ustream? Those views are in front of a drunk college girl showing her tits to stoners, you don't need GRP to know you're completely missing! Please tell me why you do this!

I always get the same answer. It's a version of this:

You are absolutely right. But you're going to have to wait for some very stubborn people in some very important positions to either retire or die. It's just the way the world works.
I don't want to wait for people to die! It's 2013, we just cured HIV! That could take forever!

I want brands, no more precisely, I want agencies that represent brands to get their heads out of their asses and start taking risks on content and metrics in a meaningful way so that I never have to see a tampon commercial ever again and my wife never needs to see a sportscar commerical ever again.

About six or seven years ago, I saw philosopher/futurist/warrior Richard Thieme speak at defCON. I discussed how a generation had emerged that identified more strongly with its online presence than its real life presence. At the time, I found this insight incredibly profound. It was an evocative message, which in my mind, best communicated the notion that sitting in front of a computer screen, for some people, results in more cozy interactions than say, sharing a lunch table.

Presently, FAKE GRIMLOCK reminds me, fuck, that defCON talk was a long time ago. Not only has the line completely blurred, not for a fringe but for most people. And furthermore, it might only be that agency we find on the internet that will ever give us the psychic tools to tolerate individuality, failure and success, the fringe and the every day, in real life.